M&S and Victoria Beckham back our tourist tax fight
Big names – and ex-ministers – pile on pressure
MARKS & Spencer and Victoria Beckham last night joined calls for the ‘tourist tax’ to be axed.
As support for the Mail campaign surged, M&S boss Stuart Machin and Marie Leblanc, head of Mrs Beckham’s fashion brand, said the move would boost the economy.
They are among more than 130 hospitality, retail and tourism chiefs to have written to Jeremy Hunt warning that stripping tourists of tax-free shopping was an ‘extraordinary own goal’.
Organised by hotelier Sir Rocco Forte, the letter was signed by the bosses of Mulberry, the Royal Opera House and Fortnum & Mason. They were yesterday backed by more businesses, including luxury cake brand Peggy Porschen, jewellers Wartski and Savile Row tailors Huntsman.
The letter brands the decision in 2021 to scrap the longstanding scheme that allowed international tourists to shop here tax-free as both ‘puzzling’ and ‘ill-timed’. They say reinstating the perk will benefit both businesses and the taxpayer by boosting tourism around the country.
A host of Conservative former Cabinet ministers also announced their backing for the Mail’s Scrap The Tourist Tax campaign – piling yet more pressure on Mr Hunt.
Iain Duncan Smith, Damian Green and Robert Buckland urged the Chancellor to look again at the issue.
Former Tory leader Sir Iain said tax-free shopping encouraged tourism and he accused the Treasury of dismissing the ‘dynamic’ benefits it brought.
‘They are attracted by things like Bicester Village [a designer outlet and former favourite of the Princess of Wales] – it brings people in and they spend more money in the UK,’ he said.
‘A lot of them came for the shopping, but they do other stuff – like go to the theatres, they spend their money.’
The Treasury claims reinstating tax-free shopping would cost the nation £2billion a year, but research suggests there would be a net annual gain of around £350million from knock-on benefits.
Campaigners say additional tourists would spend across the economy and country – in hotels, restaurants, entertainment and transport – generating separate tax revenues and creating jobs.
Mr Machin this week said London was already ‘on life support’ following Covid and now risked ‘falling way behind’ other major capitals. Other cities, such as Manchester, Liverpool and Birmingham, are also suffering.
Mr Green, a former Tory Cabinet minister and acting chairman of the Commons culture, media and sport committee, insisted scrapping the tax would boost tourism. He said: ‘This is hugely important for the tourism industry, and I just don’t believe the figures that show that the Treasury gains from abolishing tax-free shopping.
‘There is credible evidence that the increased tourist revenue that would arrive from more people coming benefits the Exchequer, as well as Britain more widely.’
Sir Robert, a former justice secretary, added: ‘It is vital that the wider benefit to our economy is taken into account by the Treasury. We need to do everything we can to boost our tourist industry and grow our economy.’
And former Tory culture minister Lord Vaizey warned
‘British goods people want’
of the impact of the tourist tax on small businesses.
He said: ‘Tax-free shopping is massively important to our economy because it supports lots of small-scale manufacturers based all over the country: artisans and craftspeople making quintessentially British goods that people all over the world want to buy.
‘They come to London to buy them, but they also go to other cities all over the country. It’s a bizarre situation by the Tory Government – supporting a sort-of tax rise that both the SNP and the Labour Party oppose.’
The campaign has already won cross-party support from the Tories, SNP and Lib Dems – as well as the Labour mayor of London, Sadiq Khan.